Crypto analysts believed that massive sales of Bitcoin by several institutional bitcoin investors in the second quarter of the year led to the high selling pressure and the fall. BTC price in the crypto market. According to Arcane Research, several institutional investors have withdrawn large sums of bitcoin since May 2022, shortly after the Terra Blockchain problems began.
According to the firm, institutional investors have withdrawn 236,237 BTC since May 10, 2022. This figure excludes normal hedging and capitulation activities that occur during bear markets. Since then, the value and price of Bitcoin and other cryptocurrencies have gradually declined. These institutional investors are selling large amounts of bitcoin, indicating a decline in trust in cryptocurrencies.
Meanwhile, there are numerous theories as to why the 2022 crypto winter season has turned extremely bearish. Many factors have contributed to this bear run, which is likely to be the worst in the history of cryptocurrencies and other digital assets. Of course, the demise of the Terra blockchain’s native token Luna and the UST stablecoin aided the current bearish trend.
On the other hand, analysts believe there is much more to this. And Arcane Research discovered one of the major contributors to the worst winter seasons in history. As a result, the massive institutional withdrawal of bitcoin exacerbated the bear market’s conditions.
The Luna Foundation Guard was among the first significant organizations to sell bitcoin. It sold 80,081 BTC in an attempt to keep its TerraUSD (UST) from collapsing in May. The miners sold their BTC because the price of BTC was constantly falling, resulting in less profit.
Although most bitcoin mining companies sold around 30% of their output in January, the situation was different in the second quarter. These businesses increased their sales rate to approximately 400% of their production. This means that the majority of the miners were selling more than their monthly production, depleting their reserves.
As a result, reports indicate that several institutional bitcoin investors sold their holdings in the second quarter, resulting in intense selling pressure that most likely contributed to the BTC price decline. Tesla, Celsius, and Luna Foundation Guard are examples of such institutional investors. As a result of the constantly falling prices, some bitcoin mining companies also sold large amounts of BTC.
Though, analysts believe that the collapse of TerraUSD was the primary cause of these market sales. In addition, despite such strong selling pressure, the bitcoin market has remained strong, with the expectation that the price will rebound above the $30 000 resistance level in the coming months. Follow TechGeyz for more updates.